City Council Spending Money Wisely, Study Finds

Despite a tighter tax base and economic circumstances that are less robust than in some other Canadian centres, Winnipeg’s city council appears to be doing a good job of spending its money wisely.

That’s according to a report released yesterday by the Frontier Centre for Public Policy, a Winnipeg-based think tank that looked at the financial situation of Canada’s largest cities based only on publicly available information.

“Winnipeg scored higher than I expected,” said Peter Holle, president of the right-leaning Frontier Centre.

GOOD NEWS, BAD NEWS

Larry Mitchell, a policy analyst from New Zealand who conducted the study, said the good news for Winnipeg is the city has much lower property tax levels than Canada’s biggest cities. It spends a greater portion of its budget than most on what the Frontier Centre calls “necessities,” like infrastructure, police and fire services, and transportation, rather than “niceties” like social, recreational and cultural services, Mitchell said.

Winnipeg’s financial assets and long-term debt were assessed as being stable and close to the national average.

The bad news is the city rates “poor” when it comes to reporting its accounts to the public, said Mitchell.

That could lead to a situation where officials don’t see the big picture and can be caught by surprise when it comes to major projects.

“Based on poor information, the public and even politicians may be beguiled into thinking everything is sweet, then these nasty surprises pop up,” said Mitchell.

Poor financial reporting and lack of “performance” reporting on services is a Canada-wide problem that puts the country 20 years behind the best practices of cities in other parts of the world, he said.

But Mike Ruta, Winnipeg’s chief financial officer, noted the report is based on 2005 figures, and said the city has changed its accounting practices since then.

‘SUCCESS STORY’

“Our 2006 statements have been restated on a comparative basis to include all of our capital assets on our financial statements. We have set depreciation rates and we are now depreciating our assets in accordance with public sector accounting principles.

“We are the first municipality in the country to do this and we have been invited to speak Canada-wide on the Winnipeg success story with respect to implementation of the new capital asset accounting principles,” he said.